MATANZAS, Cuba — In an attempt to dodge international sanctions, the state owned Venezuelan oil company, PDVSA, is now running oil out of Cuba by transferring shipments between tankers at the island’s north-western port town of Matanzas.

Thomson-Reuters reports that, according to their shipping data tracked over the course of the last three months, Venezuelan tankers have been docking at Matanzas, transferring the oil from one tanker to another, and then transporting that oil to other countries in Asia, as their tracking data have showed that at least two tankers filled with over 500,000 barrels of fuel-oil had left Matanzas by way of Venezuela en route to Singapore.

The use of the port at Matanzas is not new, as PDVSA, through Cuba’s state-run oil firm Cupet, has used Matanzas to store Venezuelan crude and fuel in the past but exports from the terminal to Asian destinations are rare.

PDVSA has also used ship-to-ship transfers to fulfil an unusual supply contract it has with Cuba’s Cienfuegos refinery. The refinery dates from the 1980s – when Cuba was a close ally of the Soviet Union during the Cold War – and the facility was built to process Russian crude.

In another sanctions dodging tactic, PDVSA in the past used its own or leased tankers to bring Russian crude from storage in the nearby Dutch Caribbean island of Curacao to Cienfuegos. But it is now transferring the imported Russian oil at sea in Cayman Islands’ waters.

The reason for the change from Curacao to that of the Cayman Islands, is because back in May 2018 a Curacao court ordered the seizure of $636 million in assets belonging to PDVSA at the Isla refinery in Curacao, and awarded multinational oil giant ConocoPhillips a portion of its $2 billion settlement won in an arbitration ruling handed down by the International Chamber of Commerce in April.

The Venezuelan government had threatened to shut down the Isla refinery due to this ruling, and sources on the ground in Curacao have told Caribbean News Now that work has come to a halt pending maintenance works being done at the plant, in addition to the signing of an agreement with a strategic partner with the Curacao public oil refining company, Refineria di Korsou (RdK), in conjunction with the PDVSA in the short term.

In a report in the Curacao Chronicle, RdK said that it was committed to Venezuela and PDVSA and in no way, shape or form must the search for a strategic partner to assist with managing the Isla refinery be seen as RdK moving away from PDVSA completely.

Venezuela and PDVSA have other issues aside from their assets seizure in Curacao, as they have not been up-to-date in paying their suppliers, maintenance and servicing sub-contractors, in addition to other downstream service companies, due to the crippling effect the sanctions have taken because they have simply not been able to pay.

This means that PDVSA has been operating tankers and machinery in need of repair and proper maintenance, raising the risk of at-sea and at-terminal leaks and accidents, which may further complicate matters with insurance companies, clean-up costs and hazards to personnel.

There have also been several oil-rig closures as Venezuela has lost nine oil rigs during 2016 to 2017, and additional 23-plus rigs between 2017 to June 2018.

With oil transshipment an already risky and dangerous job, at-sea tanker transfers, consistent filling and re-filling tankers at refineries that may themselves be in disrepair, as US sanctions and the commercial embargo have also taken their toll on Cuba, Venezuela continues to make do as best it can in the midst of their own domestic challenges as well as international sanctions.